ACC 561 Week 4 DQ
Explain how full-absorption costing can be abused by management to misstate financial results.
Explain how CVP analysis may be helpful in evaluating whether it will be smart to buy a new machine that would reduce labor costs by 60%.
Given the various CVP methods do you agree with the following statement? Why or why not? “CVP analysis is both simple and simplistic. If you want realistic analysis to underpin your decisions, look beyond CVP analysis.”
As we begin week 4 and you read about CVP what are the assumptions that underlie CVP analysis?
It is important for companies to know what their variable and fixed costs are. It is also important for management accountants and production managers to understand the relationship between activity levels and fixed and variable costs. What are some examples of a company’s fixed and variable costs? Should a company’s activity level decrease, what will happen to total fixed costs? What will happen to total variable costs?
Two terms associated with types CVP analysis are fixed and variable costs. Keeping these terms in mind, doyou agree with the following? Please explain your thoughts. “All costs are either fixed or variable. The only difficulty in cost analysis is determining which of the two categories each cost belongs to.”
ACC 561 Week 4 DQ__ANSWERED IN DETAILS__A+ WORK
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xxxxxxx xxx full-absorption xxxxxxx xxx xx abused xx xxxxxxxxxx to misstate xxxxxxxxx xxxxxxxxx
xxxxxxxxxxxxxxx costing xxxxxx is x xxxxxxxxxx xxxxxxxxxx xxxxxx xxxx xxxxxxxx xxx or xxxxxxxx the full xxxx of xxxxxxxxxxxxx a xxxxxxxxxx product or xxxxxxxx xxx xxxxxxxxx Accepted xxxxxxxxxx Principles requires xxxxxxxxxxxxxxx xxxxxxx xxx xxxxxxxx reporting. xx takes into xxxxxxx xxx xxxxx xxxxxx xxxx of labor, xxxxxx material cost, variable xxx xxxxx xxxxxxxxxxxxx cost related to the xxxxxxxx xx includes anything xxxx xx x direct cost in the xxxxxxxxxxxxx of x xxxxxxxx It helps x company xx understand whether the xxxxxx price xx x xxxxxxx xxxxx reflects xxx xxxxx xx x product.
Although full-absorption xxxxxxx xx x very xxxx xxxxxx for xxxxxxxxxx xxxxxxxxxxx this costing method can be xxxxxx xx management to xxxxxxxx xxx xxxxxxxxx xxxxxxxx xxxx method is critical xxx companies that cannot xxxxxx a xxxx xx xxxx xxxxxx sell xxxxxxxx without xxxxxxxxxxx the xxxxxxxxx What
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